Here’s a recent article from the Washington Post that shows why tax reform isn’t as simple as “take away all the deductions and make it simple.” People are attached to their favorites, and even if it can be shown that you’ll pay less taxes without the deductions, people are skeptical.
“Get rid of the deductions that don’t affect me.” That’s what Debbie Schaeffer, the owner of Mrs. G TV and Appliances, told Max Baucus and Dave Camp, the chairmen of the Senate and House committees charged with tax reform, when they asked for her advice.
It’s an ingenious system that makes incumbents look great because they gave us that special tax break…but we really need to start looking at this the other way. Renters pay a higher tax rate. People who don’t give to charity pay a higher tax rate. People who buy their own insurance (instead of employer-provided) pay a higher tax rate. People with no children pay a higher tax rate.
Simplifying the tax code will help choke the overspending of government…but even if it’s tried, the special interests rebel and it’s shown to be very unpopular.
This is why we don’t have a flat tax or a simple tax code. Once social engineering in the tax code starts, it can’t be turned around.